PC Jeweller hits over 2-year low on withdrawal of buyback offer; falls 22%

The stock tanked 22% to Rs 93.35, trading at its lowest level since December 19, 2014 on the BSE.

Shares of PC Jeweller hit an over two-year low of Rs 93.35 per share, falling 22% on the BSE in early morning trade after the company announced the withdrawal of proposed buyback offer due to the non-receipt of the NOC from the its bankers. The stock was trading at its lowest level since December 19, 2014.

Thus far in the calendar year 2018, the stock plunged 80% from Rs 457, as compared to 7% rise in the S&P BSE Sensex.

“In view of the non-receipt of the requisite NOC from the Company's Bankers, the board of directors at its meeting held today has decided to withdraw the aforesaid Buyback Offer with immediate effect,” PC Jeweller said in a regulatory filing on Saturday, July 14, 2018.

The bankers recommended that for the current year the company should continue to focus on growth and give priority to further reduce its interest expense to the maximum extent possible. Accordingly, they did not approve the proposal of Rs 4,240 million of cash flowing out of the company vide their-letter dated 12th July, 2018 and have not given the required NOC to the Company for its buyback offer, it added.

Meanwhile, in another regulatory filing, PC Jeweller said the new financial year (FY) has started off at a satisfactory note for the company. The company has continued to gain market share in the domestic jewellery market. It had set an internal target of 20% QoQ growth in Q1 and even in subdued industry scenario has almost achieved the same.

At 09:52 am; PC Jeweller was trading 17% lower at Rs 99.50 on the BSE, against 0.03% rise in the Sensex. A combined 23.72 million equity shares changed hands on the BSE and NSE so far.